Survey of Non-Profit Leaders - Finances

Things are tough in the non-profit world these days. A recent survey of 986 non-profit leaders conducted by the Non-Profit Finance Fund, an organization that provides loans and other financial services to non-profit groups, found that only 12% expect to operate above break-even this year and 31% only have one month of operating cash on hand.

Key findings include:
Only 12% expect to operate above break-even this year.
Just 16% anticipate being able to cover their operating expenses in both 2009 and 2010.
31% don't have enough operating cash in hand to cover more that one month of expenses, and another 31% have less than three months' worth.
52% of respondents expect the recession to have a long-term (2+ years) or permanent negative financial effect on their organizations.
93% of lifeline organizations that provide essential services anticipate an increase in demand in 2009.
The NY Times reported on the results:

http://www.nytimes.com/2009/03/26/us/26charity.html?src=linkedin

Summary of results and full results can be viewed here:

http://www.nonprofitfinancefund.org/docs/2009/SurveyResultsSummary

One of the things that jumped out at me was that half the respondents said they wanted help communicating their financial difficulties to their boards and donors.
So often it comes down to communication.

Even when money is tight, non-profits have to find a way to help the public, elected officials, board members and funders to understand what they do, how they do it, what it costs, and why it’s important.

Too many people don’t understand why non-profit staff members want to make a decent salary. They still think of old-fashioned charity and assume people will volunteer their time. Surprisingly, even people who run businesses throw out all the rules they follow every day with their own companies when they get involved with non-profits.

And yes, we all want the vast majority of contributed revenue to go to the programs that help people in need, but we have to remember that in order to do that, organizations need to be able to keep the lights on, buy office supplies, update their websites, etc.

It’s up to those of us in the non-profit world to do what we can to change these perceptions, and it’s something we have to work on especially in tough times.